Category Archives: Miscellaneous

106 Discrete Steps to Global Trade

Stanford University Professors Warren Hausman and Hau Lee recently decided that an end-to-end model was required for global trade management and decided to research the requirements. Analyzing imported goods from Asia to the US in the apparel sector, Hausman and Lee identified 106 discrete steps in the global trade management process. One Hundred and Six. Wow!

They also found ample opportunities for ROI for investment and improvement of global trade processes. Specifically, they estimated that importers actively using Asian sourcing had an opportunity through automation to reduce their supply chain costs by a range of 0.6-2.2% of annual sales. This is a substantial level versus average corporate net profit margins in the apparel sector. For instance, at an average profit margin of about 6%, such a decrease in costs would boost the corporate bottom line by 10% – 37%.

So, if you have IT-enabled global trade management, you:

  • have enhanced efficiency
    as you don’t have to manually execute 106 steps
  • are significantly safer
    the visibility lets you corrupt hiccups before they become costly seven or eight figure disruptions
  • have profits a-plenty
    as you’ve just increased the bottom line by 10% to 40%

So if you don’t have one, go get yourself a GTM solution today! Need a provider listing, start with the resource site.

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Browser Wars — For the Techie in All of Us

A recent visualization over on Axiis, the open source data visualization framework, displays the W3.org’s Historical Browser Statistics from January 2002 to August 2009. It’s definitely worth checking out … you can see the rise and fall of Mozilla, Netscape, IE, AOL, Opera, Firefox, Safari, and Chrome over time.

Hat-Tip to Matthieu Cormier, of Cocoa Mondo, a fellow Haligonian.

The Value of Capability Coherence in One Industry

A recent article in Strategy+Business on Cut Costs, Grow Stronger had the following graph which I think is just great:

Any guesses as to what most of the companies on the line (and, specifically, those closer to the upper right of the line) have in common? Anyone?

These companies were all early adopters of strategic sourcing decision optimization. Think about it.

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The Right Way to Cost Cut

I enjoyed this recent McKinsey Article that noted that companies should start any cost-cutting initiative by thinking through whether they could restructure the business to take advantage of current and projected marketplace trends (for instance, by exiting relatively low-profit or low-growth businesses) or to mitigate threats, such as consolidating competitors. This is much better than the usual practice of cutting equally about everywhere because quick head count reductions often come at a price: missing the opportunities that crises can create to improve business systems or to strengthen parts of an organization selectively.

Also, in some cases, efforts to complete merger integration or to use the new economic situation as a spur to renegotiate supplier or other long-term contracts can yield substantial economies. In the authors’ experience, savings of up to 20 to 35 percent in selling, general, and administrative costs are possible with such measures if companies select the right tactics to support their strategies. The reality is that intelligent cost cutting need not reduce the overall scale of the savings that organizations can achieve. By shifting the focus from organizational structure to current and future strategic needs, it makes for smarter savings, even at companies that have already started down another path.

So don’t be another dumb company. If you have to cut, cut smart.